OPEC Accused Of Hiding Spare Capacity

The State Department said figures from the Energy Information Administration suggested that OPEC was withholding 1.42 million bpd of spare capacity and the department was working with the cartel to “produce the spare capacity,” as S&P Global Platts put it. The way this “hidden” number of barrels was calculated was not revealed. In its latest Short-Term Energy Outlook, the EIA estimated OPEC’s spare production capacity at 1.66 million bpd . Most of this must be Saudi Arabia’s spare capacity, and one cannot forget that the spare capacity of Venezuela is questionable, as is the spare capacity of other troubled oil producers such as Libya and Iran. To make matters more confusing still, the International Energy Agency last month estimated OPEC’s spare capacity at 2.7 million bpd and is fast declining. Bloomberg quoted a warning from the international agency that the producers who had promised to offset any loss of […]